Articles about loans, savings and money

Financial problems are something which nobody wants, yet most of us will come to face at some point during our lives. While many monetary issues cannot be prevented, there are certainly ways that you can combat them and make things easier for yourself. Here are some of the things that you can consider when in financial difficulty.

Get an overdraft

Getting an overdraft from your bank can make things a whole lot easier for you, and although you have to pay it back eventually, it’s a good short term solution for your problems. However, the interest on overdraft can often be very high, and many banks will limit the amount you can borrow, especially if you’re known to have financially troubles on a regular basis. You can talk to your bank about increasing your overdraft limit, but this can often take a few days or even weeks if they have to review your request. If you do go into your overdraft, make sure that you pay the money back as soon as you can in order to avoid paying hefty fees.

Short term loans

Short term loans are a great way to give yourself some flexibility and take away some of the stress that you might be experiencing. A lot of people take out short term loans, or payday loans, when they don’t quite have enough money to cover the costs which they have to pay within the month. You can take out a short term loan as long as you’re at least 18 years of age and you have a bank account and a job, so it’s very easy to qualify. A lot of short term loans can be paid into your bank within a matter of minutes, so if you need money very quickly, it’s the perfect solution.

Budget better

If you’re in terrible financial difficulty, budgeting can make it a little bit easier, although you may need something more practical, like a short term loan, in order to get out of the problems. However, for the future, you can start to think about budgeting better so that you don’t need anything to assist you next time you have issues. You should constantly revisit and revise your budget to make sure that it’s still working out for you. A weekly budget often works better for some people, especially if you find yourself overspending during the few days after payday.

For many of us, driving is an essential. In order to get to work, drop the kids off at school and travel around at the weekends in order to visit family and friends, we need a car. However, paying for extras such as car insurance and tax can really add up, and many people find themselves struggling to pay the hefty costs to be on the road. Here are some of the things that you can do to ensure you get the best deal on your car insurance.

Don’t stick to the price comparison websites

Price comparison websites provide a great platform for helping you quickly compare a wide variety of insurance companies. However, some of the cheapest insurers might be missing from the list that you get back at the end. It’s a good idea to research all of the main insurance companies in the country and check which ones haven’t been searched through the price comparison website. There could be even cheaper prices out there!

Add named drivers

This works particularly well if you’re a young driver, so if you’re under the age of 25, think about people in your family that you could add to your policy. The price may go up, but if you’ve added safe and secure drivers, the cost of your policy is likely to go down. Try adding a variety of different people to your policy in order to see which ones work best and make the price as low as possible for you.

Get a smaller car

If you find that your car insurance is constantly high, think about the possibility of getting a smaller car. A car with a smaller engine and therefore less power is going to cost you a lot less each month in insurance costs, so if you can compromise on size, this is definitely something to consider. Continue reading →

Ask people what’s the worst thing they can do with their personal finances and you’ll get a whole range of answers: spending frivolously; keeping cash under the mattress; paying back only the minimum payment on cards.

But as bad as all of these can be, there’s one thing that can be dumber than all of them: yet far too many of us do it right now.

The Crime Defined

What’s the sin? Simply put: having savings and debt at the same time.

Here’s a very simple example of why it’s so wrong in principle. If you have a £1,000 credit card balance at 18% annual interest, and £500 in a savings account at 5% annual interest, then at the end of the year you’ve paid £180 in interest, made £25 in interest, and wound up £155 worse off.

If, however, you use the £500 in the savings account to pay off some of the card balance, you wind up paying just £90 in interest. You’re still paying out overall, but you’ve cut your losses by £65.

Not only is this hypothetical example a reality for many people, but some of us even have debts and savings with the same financial institution. That’s absolutely crazy. There’s a good reason banks charge more in interest on debts than they pay in interest on savings: it’s how they turn a profit. When the banks can exploit this rate gap with the same customer, they must be secretly laughing their heads off.

What’s The Answer?

The key to overcoming this financial sin actually lies with a wider principle: prioritizing the debts with the highest interest rate. All things being equal, you should always put any spare cash towards paying off the highest rated debt, for the simple fact that it cuts your overall interest costs. Remember that every penny you pay in interest is effectively a complete waste of your cash. Paying the highest rated debt first means more of your money is working for you.

Extending this philosophy to take account of savings is fairly simple. Every one percent you earn in interest or investments is equivalent to using the same cash to pay off one percent in debt interest. Using cash to earn interest at 5%, like in our example, brings only the same benefit as paying off a debt that carries a 5% rate. Continue reading →

The key to enjoying your retirement years is having a plan in place to ensure that everything goes smoothly. The first thing to consider is the amount of retirement savings and retirement income that you have. There are many retirement calculators that can give you an estimate how much you need to set aside and for how long before the money becomes sustainable during the retirement years.

It is best to start saving early because it has a substantial impact on the money that will be available to you when you do decide to retire. Another thing to consider is the income generated from other sources, such as assets or pension plans. It is very important to factor in the effect of inflation as it tends to devalue the amount of money you have. Planning is essential to make sure that you have enough money to last you during your retirement.

Retirement means that you have a lot of freedom in the activities that you do decide to pursue. There are many different ways to spend retirement so it can be helpful to get an idea of what you want to do during that time. A simple first step plan is to make a list of all the things that you want to do. Some examples include traveling, teaching or maybe writing. Once you have the list, choose the ones that you like the most and start planning how to go about achieving those goals.

It is also helpful to get a good idea of where you want to stay. If you want to stay at a retirement home, take a look around to see what’s available. When choosing a location, you have to take into consideration things like recreational activities and social activities. Something that also matters is the cost of living associated with the location of the retirement home. Places with higher costs tend to have more activities available so you have to weigh those two factors when choosing.

Are you thinking about trying to get a loan, but you’re worried about all of the money that you’re going to have to pay back? Well, it’s definitely time that you started looking at some of the secrets to keeping your loans as cheap as possible. You have the early repayment system, which saves you a lot more money than you might imagine.

You see, it’s all about the fees when it comes to the loan. The lender will only make a profit if they’re charging you interest along with all of those other fees. Interest is why you can borrow 500 pounds and yet have to pay closer to 800 pounds after everything is all said and done. The bank has to make some money off to the deal. Only your friends and family will be willing to loan you money simply out of the kindness of their own hearts. This means that you have to shop around smart, but not just looking at price.

Ideally you want to go with a loan that has no penalty for paying it off early. Instead of the banker being able to pocket all of that interest, you will have the loan paid off faster than what you would normally expect. This leaves you free to do all sorts of things with the monthly payments that you’re no longer handling. That’s always a good thing, isn’t it?

This is where we divert form traditional media, who seems to think it’s a crime if you take out any type of credit product. That’s not something that we believe in. We think that loans are like any other form of credit. It’s all about how you use them. If you’re someone that can take care of their loan and pay it back, then you’re going to be just fine. However, if you don’t pay your loan on time, you’re going to have problems. But this is true in just about every area of life that you can think about. If you don’t pay your stuff on time, you’re going to have difficulties. There’s no way to get around that at all.

We hope that you’ll use early repayment to your advantage, because it really means getting a much cheaper loan than if you were to pay on their schedule. It might take some personal sacrifice to have the extra money, but it’ll be well worth it when you think about all of the money you’re really saving. Good luck!

Are you thinking about taking out a loan in the near future? You might have plan to redo your home, or even just take the holiday that you’ve always wanted to enjoy. The truth is that you’re going to need money for these things. You don’t have to spend a lot of money always, but you’re going to eventually need to ask for that loan that you have on your mind. It’s perfectly okay to do so, but you’re going to need to look at what it really takes to get a loan.

Of course, with the rise of the Internet, there’s no shortage of loans out there. But are they all the right loan for you? Not hardly. You might find yourself paying way too much interest when you could be getting a cheaper loan. Interest is how the company makes their money, so you don’t want to skip over it too terribly much. It’s completely up to you to figure out what you really need to be the type of borrower that lenders are really looking for.

In a nutshell, there are just a few factors that really determine who gets the best rates. The first factor is whether or not you own a home. It might not seem fair, but it’s true — homeowners really do get the best deals around. So if you’re not a homeowner, you’re going to be locked out of the top deals — but you can still get a good rate. You also need to think about your current tenant agreement. Are you paying all of your monthly payments on time? If not, that could show up. It just depends on the type of loan that you’re applying for.

What about your current credit obligations? If you’re not paying them on time, you’re not going to be a preferred person. If you’re noticing a pattern, you would be right – it’s all about how you take care of your current life. Lenders need to realize that you are going to be paying the loan off in a timely fashion, without defaulting. They have to take a risk, so they like to make sure that they’re taking a risk that makes sense.

If you own your own home, been at a job for over 5 years, make all of your payments on time and have extra money left over after your bills, then you’re going to get the best loan rates. Of course, that does mean that you will have a higher rate if you don’t fit this mold of a model customer.

The only thing that you can do after a certain point is make sure that you’re going to get the best deal online. Shopping online gives you an idea of what lenders are willing to make considerations for you and which ones aren’t. Don’t let anyone tell you that you’re priced out of the market for a loan. Trust us, you just don’t know what’s out there until you start looking around.

If you have finally gotten approved for a loan modification, you might wonder how you’re ever going to be able to get your finances back under control. Even if things haven’t gotten truly bad yet, you should still be talking to your mortgage lender before you do anything else. It’s tempting to just hide under the covers and hope that your situation changes but life rarely works out this way. Facing your lender before things get really bad heightens your options. Lenders have their own modification programs depending on how much you make as well as where you live. Not every area goes by the same cost of living. Should you be punished because you live in an area that has now become a high cost of living area — even if it wasn’t that way when you moved?

You need to always be thinking about your options as you go along. It’s tempting to just skip over things but the reality here is that you must ensure that you are thinking about the way you actually handle absolutely everything that comes to you after a loan modification.

First and foremost, you will need to make sure that your budget is going to be as strong as possible. It’s tempting to hope that you can just go with your gut, but very few people track every last expense they are making down to the penny. That would highlight exactly what’s going in and out of the house, and many people aren’t ready to face reality. Sorry if that sounds harsh, but when you’re under a lot of stress facing reality is usually not very high on your list of things to do. Continue reading →

Modifying a loan can seem like a great option. To borrow more money so that you can pay for more things, perhaps a holiday, maintenance on the house or a wedding, might seem like a fantastic use of the money. Perhaps reducing the amount you pay back each month, but paying over a longer term, might be great as you will have some money free each month to be able to treat yourself to more things. However, there are costs to doing this and you need to think about these as well.

The costs could be quite significant and you do not want to have to suffer in the future because you have been frivolous. However, you may find that the money you release from changing your loan has a high impact on your life and is well worth the additional costs.

All loans cost money, but many people do not realise quite how much.

We tend to be worried about very short term loans because we can end up paying back almost twice as much as we borrowed. However, with a mortgage, we normally end up paying back three times what we borrowed because we are paying back for such a long time. It is therefore very important to calculate the cost of what you are doing.

Borrowing more money will mean that you are paying more interest to the bank and therefore cost more. Paying over a longer term will also mean that you are paying more interest and so you need to calculate exactly how much more you will be paying. This is difficult because if interest rates go up, you will be paying even more and if they go down, you will be paying less. However, if you assume that they stay the same, you can make some rough calculations.

It is also worth noting that there may be fees and other costs too. If you want to borrow more money, the lender will need to find out what the value of your property is and this may mean they do a search and charge you for it. There will also be administration work required to change your account and you may get charged a fee for this as well.

It is important to be aware of all of the costs and calculate them before you sign up to anything so that you are aware of how much you are paying for these changes that you are making.

In order to avoid millions of people losing their homes in the face of the current economic situation, loan modifications will be made in cases where it may have before been impossible. A loan modification is when one or more of the conditions of the loan are changed. In this case, under the Home Affordable Modification Program has several built in guidelines that make it a win-win situation for the borrower and the lender. The most significant advantages to the borrower will be the modification itself which will allow them to keep their home but also lower payments and incentives for paying on time.

There will be outreach programs funded so that home owners can find out if they qualify for loan modification and get answers to any questions they may have about them. The program will be strictly monitored as well with regular meetings with the lenders and the treasury department. This will help lower the chances of anyone falling through the cracks (if any) in the program.

Every servicer participating in the program will be required to report standardized loan-level data on modifications, borrower and property characteristics, and outcomes. Servicers are given incentives to find alternatives to foreclosures which makes it a promising aspect to lenders. Such methods reduce vacancy, neighborhood decline, and overall costs for financial institutions, borrowers, and affected communities alike.

There will be order and consistency within the loan modification programs within the federal and the private sector which furthers the chances of success. Every effort is being made to ensure that loan modifications are not only available but prove to be practical once applied. Due to these new guidelines millions of people will be able to keep their homes that otherwise they would have lost through foreclosure. The safety nets and close monitoring can bring peace of mind to both borrows and lenders.

With the new federal guidelines, people with HUD homes, for example may have lost their homes because the home value had been reduced through recent Fannie Mae and Fannie Mac troubles as well as an unstable economy. Those people are now eligible for loan modification to change the terms of their loan and also reduce their monthly payments to within 31% of their income. Continue reading →

The economy has been taking a dive for a while now and things don’t appear to be getting better. More people than ever are facing foreclosure if they do not receive some type of loan modification help. Even those who are now current on their mortgage payments realize that they may soon fall behind due to lay off and job losses. If someone is unable to refinance the loan for any reason, there are several options that may be available.

If you are already behind on payments you can speak to your bank about working out an arrangement to get current with your payments, say, within the next year. The lender has the final say but this option is open to explore. In fact, until recently, you had to be behind on payments in order to get any type of loan modification help. Of course, this describes a lot of people with the current economic situation. There are estimations that up to 6000 or more families will lose their homes in the next several years unless they are offered help.

Loan modifications come in all sizes and shapes so there are options. The latest help available is in the form of the new Affordable Home Program. This program is available to those who are not behind on their payments but still need to have their payments and interest lowered in order to stay current. The new program will also help those who owe more on their home than it is currently worth. Property values have declined sharply so many who would not qualify under existing programs may now qualify under the White House Plan.

Regardless of a home owner’s situation, every avenue should be explored. Whether you are behind on your payments now or not you could be facing problems in the near future. You can speak to your bank or loan institution or you can find out more about the Affordable Home Program. There is supposed to be new information available as well as loan counselors to help answer questions about the program. Continue reading →